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S

Property Factors (Scotland) Act 2011

2011 asp 8

The Bill for this Act of the Scottish Parliament was passed by the Parliament on 3rd March 2011 and received Royal Assent on 7th April 2011

An Act of the Scottish Parliament to establish a register of property factors and require property factors to be registered; to make provision in relation to the resolution of disputes between homeowners and property factors; and for connected purposes.

Part 1SRegistration of property factors

Establishment of register etc.S

1Register of property factorsS

(1)The Scottish Ministers are to prepare and maintain a register of property factors for the purposes of this Part (“the register”).

(2)The register must be available for public inspection at all reasonable times.

[F1(2A)The Scottish Ministers may omit any material which falls within section 5(2) from the register made available for public inspection if they consider it appropriate to do so.]

(3)In this Part, “registered” means registered in the register, and “unregistered” means not registered in the register.

2Meaning of “property factor”S

(a)a person who, in the course of that person's business, manages the common parts of land owned by two or more other persons and used to any extent for residential purposes,

(b)a local authority or housing association which manages the common parts of land used to any extent for residential purposes and owned—

(i)by two or more other persons, or

(ii)by the local authority or housing association and one or more other person,

(c)a person who, in the course of that person's business, manages or maintains land which is available for use by the owners of any two or more adjoining or neighbouring residential properties (but only where the owners of those properties are required by the terms of the title deeds relating to the properties to pay for the cost of the management or maintenance of that land), and

(d)a local authority or housing association which manages or maintains land which is available for use by—

(i)the owners of any two or more adjoining or neighbouring residential properties, or

(ii)the local authority or housing association and the owners of any one or more such properties,

but only where the owners of those properties are required by the terms of the title deeds relating to the properties to pay for the cost of the management or maintenance of that land.

(2)Despite subsection (1), the following are not property factors for the purposes of this Act—

(a)a person so far as managing or maintaining land on behalf of the Crown that was acquired by virtue of Her Majesty's prerogative rights in relation to unclaimed or ownerless land,

(b)an owners' association established by the development management scheme (within the meaning of the Title Conditions (Scotland) Act 2003 (asp 9)) so far as managing or maintaining common parts or land in accordance with the scheme,

(c)a person so far as managing or maintaining common parts or land on behalf of another person who is a property factor in relation to the same common parts or land.

(3)The Scottish Ministers may by order modify either or both of subsections (1) and (2).

(4)An order under subsection (3) may make such consequential modifications of any other provision of this Act as may be necessary or appropriate.

(5)An order under subsection (3) is not to be made unless a draft of the statutory instrument containing the order has been laid before, and approved by resolution of, the Scottish Parliament.

(6)In this Part—

“housing association” has the meaning given by section 1 of the Housing Associations Act 1985 (c.69),

“local authority” means a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994 (c.39).

RegistrationS

3Application for registrationS

(1)A person who is, or intends to become, a property factor may apply to the Scottish Ministers for entry in the register.

(2)An application under subsection (1) must specify––

(a)the full name and business address of the person, and if formed and registered under the Companies Acts, the company's registered number,

(b)whether the person is trading as a sole trader, partnership or company or has some other legal status,

(c)where the person is not trading as a sole trader, the full name and business address of the individual who holds the most senior position within the management structure of the partnership, company or body which is (or is to be) directly concerned with the control or governance of the property factor,

(d)the full name and address of any other person who is (or is to be) directly concerned with the control or governance of the property factor,

(e)any dwelling houses, flats or land in relation to which the person acts, or expects to act, as a property factor, and

(f)such other information as the Scottish Ministers may by regulations prescribe.

(3)An application under subsection (1) must be—

(a)signed by the responsible person, and

(b)subject to subsection (4), accompanied by such fee as the Scottish Ministers may determine.

(4)Subject to subsection (5), the Scottish Ministers may by regulations prescribe for the purposes of subsection (3)(b)––

(a)fees,

(b)how fees are to be arrived at,

(c)cases in which no fee is payable.

(5)The Scottish Ministers must secure that, taking one financial year with another, the income from fees under this section and section 7 does not exceed the total cost incurred in exercising their functions under this Part.

(6)A person who, in an application under this section––

(a)specifies information which the person knows is false in a material particular, or

(b)knowingly fails to specify information required by subsection (2),

is guilty of an offence.

(7)A person guilty of an offence under subsection (6) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(8)For the purposes of subsection (2)(d) and section 5, persons who are directly concerned in the control or governance of a property factor include any person who owns 25% or more of the equity in a business which is a property factor.

(9)In this Part, the “responsible person” is—

(a)where the person making the application under subsection (1) is a sole trader, that person,

(b)in any other case, the person specified in the application by virtue of subsection (2)(c).

5Section 4: considerationsS

(1)In deciding for the purposes of section 4(4)(a) or (b)(i) whether a person is a fit and proper person to be a property factor, the Scottish Ministers are to have regard (among other things) to any material falling within subsections (2) to (4).

(2)Material falls within this subsection if it shows that any person who is (or is to be) directly concerned with the control or governance of the property factor, has––

(a)been convicted of any offence involving––

(i)fraud or other dishonesty,

(ii)violence, or

(iii)drugs,

(b)practised unlawful discrimination on the grounds of any of the protected characteristics in Part 2 of the Equality Act 2010 (c.15), or

(c)contravened any provision of the law relating to tenements, property or debt.

(3)Material falls within this subsection if it shows the extent to which any other property factor with which the person (or any other person who is, or is to be, directly concerned with the control or governance of the property factor) is or has previously been involved demonstrates or demonstrated compliance with—

(a)the property factor code of conduct, and

(b)any property factor enforcement order made against that other property factor by [F4the First-tier Tribunal] .

(4)Where the person is, or has previously been, registered, material falls within this subsection if it shows that the person has failed to pay any charges imposed by virtue of section 26.

6Notification of registration, refusal to register or removalS

Where the Scottish Ministers—

(a)enter a person in the register under section 4(4),

(b)refuse to enter a person in the register under section 4(5), or

(c)remove an entry under section 4(7),

they must, as soon as practicable after doing so, give notice to the responsible person of that fact and, in a case mentioned in paragraph (a) or (c), the date of entry or, as the case may be, removal.

7Duty of responsible person to provide informationS

(1)This section applies where a property factor is registered.

(2)Where in consequence of a change in circumstances any information provided by the property factor to the Scottish Ministers by virtue of section 3(2)(a) to (d) or, as the case may be, this subsection, becomes inaccurate, the responsible person must, as soon as practicable after the inaccuracy arises, give notice to the Scottish Ministers of the change that has occurred.

(3)The property factor must, no later than three months after the end of each financial year, give notice to the Scottish Ministers—

(a)of any dwelling houses, flats or land in relation to which the property factor has acted as property factor during that financial year, or

(b)if there has been no change in that information since—

(i)the date of the last notice given under this subsection, or

(ii)if the person became registered as a property factor during the financial year, the date on which the person provided the information referred to in section 3(2)(e),

that there has been no change in that information.

(4)Subject to subsection (5), any notice given under subsection (2) or (3) must be accompanied by such fee as the Scottish Ministers may determine.

(5)Subject to section 3(5), the Scottish Ministers may by regulations prescribe for the purposes of subsection (4)––

(a)fees,

(b)how fees are to be arrived at,

(c)cases in which no fee is payable.

(6)A person who, without reasonable excuse, fails to comply with subsection (2) or (3) is guilty of an offence.

(7)A person who, in a notice under subsection (2) or (3), provides information which the person knows is false in a material particular, is guilty of an offence.

(8)A person guilty of an offence under subsection (6) or (7) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

Removal from register etc.S

8Removal from registerS

(1)Subject to subsections (4) and (6), the Scottish Ministers may remove a property factor from the register if subsection (2) or (3) applies.

(2)This subsection applies where a property factor is registered by virtue of section 4(4)(a) and the Scottish Ministers consider that—

(a)the property factor is no longer a fit and proper person to be registered as a property factor,

(b)the property factor has failed to comply with section 13(3), or

(c)the property factor has failed to demonstrate compliance with—

(i)the property factor code of conduct, or

(ii)any property factor enforcement order made against the property factor by [F5the First-tier Tribunal] .

(3)This subsection applies where a property factor is registered by virtue of section 4(4)(b) and the Scottish Ministers consider that one or more of the conditions specified in sub-paragraphs (i) to (iv) of that section is no longer met.

(4)Before removing a property factor from the register under subsection (1) the Scottish Ministers must––

(a)give notice to the responsible person that removal under that subsection is under consideration, and

(b)allow the property factor an opportunity to make representations to them.

(5)Notice under subsection (4) must be accompanied by a written statement of the Scottish Ministers' reasons for proposing to remove the property factor from the register under subsection (1).

(6)The Scottish Ministers must not remove the property factor from the register under subsection (1) unless they are satisfied, after taking account of any representations made to them under subsection (4)(b), that subsection (2) or (3) applies.

(7)Where the Scottish Ministers decide to remove a property factor from the register under subsection (1), they must, as soon as practicable after doing so, give notice of that fact (and the date of removal, which must be a date no less than 21 days after the date notice is given under this subsection) to the responsible person and give public notice of the date of removal.

9Effect of refusal to enter in register or removal from registerS

(a)refuse under section 4(5) an application for entry in the register by a person who is operating as a property factor on the day on which section 3 comes into force,

(b)remove a property factor from the register under section 4(7), or

(c)remove a property factor from the register under section 8(1).

(2)After the relevant date––

(a)no costs incurred by the property factor in respect of work instructed after the relevant date are recoverable,

(b)no charge imposed by the property factor which relates to a period after the relevant date is recoverable,

(c)homeowners may appoint new property factors (or decide to manage their properties without appointing a property factor) in accordance with the procedures made in relation to such decisions in their title deeds or, as the case may be, the Tenement Management Scheme,

(d)the property factor may not lodge a notice of potential liability for costs under section 13(1) of the Tenements (Scotland) Act 2004 (asp 11) in respect of work instructed after the relevant date.

(3)The Scottish Ministers must, as soon as practicable after the relevant date, give public notice of—

(a)the refusal or removal mentioned in subsection (1)(a), (b) or, as the case may be, (c),

10Section 9: interpretation etc.S

(1)For the purposes of section 9(1)(b), a property factor is not removed from the register where the entry removed under section 4(7) is replaced, before or at the time of the removal, by another entry made by virtue of a further application for entry in the register under section 3(1) by the person to whom the entry removed under section 4(7) relates.

(2)In section 9, “relevant date” means—

(a)in relation to a case mentioned in section 9(1)(a) or (c), the day after the day on which––

(i)the period within which any appeal under section 11(2) may be made expires (without such an appeal being made), or

(ii)any such appeal is concluded (without the Scottish Ministers being required to enter the applicant in the register),

(b)in relation to a case mentioned in section 9(1)(b), the day after the day on which the entry in the register is removed under section 4(7).

(3)For the purposes of subsection (2), an appeal is concluded only when—

(a)the period within which an appeal under section 11(9) may be made has expired without such an appeal being made, or

(b)any such appeal has been concluded.

(4)In section 9(2)(c), “Tenement Management Scheme” has the meaning given by section 29(1) of the Tenements (Scotland) Act 2004.

(5)In this Act, “homeowner” means—

(a)an owner of land used to any extent for residential purposes the common parts of which are managed by a property factor, or

(b)an owner of residential property adjoining or neighbouring land which is—

AppealsS

11Appeal against refusal to register or removal from registerS

(1)This section applies where the Scottish Ministers––

(a)refuse to enter a person in the register under section 4(5), or

(b)remove a property factor from the register under section 8(1).

(2)A person mentioned in subsection (1)(a) or (b) (“the applicant”) may, not later than 21 days after the day on which the responsible person receives notice under section 6 or 8(7), appeal to the sheriff against the refusal or, as the case may be, removal.

(3)After giving the parties an opportunity to be heard, the court may, if it considers that it is reasonable to do so having regard to the factors mentioned in subsection (4), require the Scottish Ministers to enter the applicant in the register.

(4)The factors are—

(a)in a case where the applicant has not previously been registered, that the applicant is a fit and proper person to be a property factor,

(b)in any other case, the conditions mentioned in section 4(4)(b).

(5)Section 5 applies for the purposes of this section as it applies for the purposes of section 4, but with the references to the Scottish Ministers being read as references to the court.

(6)The court is to give reasons for its decision under subsection (3) in writing.

(7)An entry made by virtue of subsection (3) is to be treated as if—

(a)in a case where the applicant has not previously been registered, it is an entry made by virtue of section 4(4)(a),

(b)in any other case, it is an entry made by virtue of section 4(4)(b).

(8)An appeal under subsection (2) is to be made by summary application to the sheriff.

(9)An appeal on a point of law only against the decision of a sheriff on an application under subsection (2) may be made to the sheriff principal.

(10)An appeal under subsection (9) must be made not later than 21 days after the day on which the decision appealed against is made.

(11)The decision of the sheriff principal on an appeal under subsection (9) is final.

EnforcementS

12Offence of operating as a property factor without registrationS

(1)Except where subsection (2) or (3) applies, a person who operates as a property factor while unregistered is guilty of an offence.

(2)This subsection applies where––

(a)a person who is operating as a property factor on the day on which section 3 comes into force has made an application for entry in the register, and

(b)the application has not yet been determined by the Scottish Ministers under section 4.

(3)This subsection applies where a property factor has been removed from the register under section 8(1) but only until—

(a)the period within which any appeal under section 11(2) in relation to the removal may be made expires (without such an appeal being made), or

(b)any such appeal is concluded.

(4)It is a defence for a person charged with an offence under subsection (1) to show that there was a reasonable excuse for acting in the way charged.

(5)A person guilty of an offence under subsection (1) is liable on summary conviction to a fine not exceeding level 5 on the standard scale, or to imprisonment for a term not exceeding six months or to both.

(6)Where—

(a)an offence under subsection (1) has been committed by a body corporate or a Scottish partnership or other unincorporated association, and

(b)it is proved that the offence was committed with the consent or connivance of, or was attributable to any neglect on the part of—

(i)a relevant individual, or

(ii)an individual purporting to act in the capacity of a relevant individual,

that individual, as well as the body corporate, Scottish partnership or other unincorporated association, is guilty of the offence and is liable to be proceeded against and punished accordingly.

(7)In subsection (6), “relevant individual” means—

(a)in relation to a body corporate—

(i)a director, manager, secretary or other similar officer of the body,

(ii)where the affairs of the body are managed by its members, a member,

(b)in relation to a Scottish partnership, a partner,

(c)in relation to an unincorporated association other than a Scottish partnership, a person who is concerned in the management or control of the association.

(8)For the purposes of––

(a)subsection (2)(b), an application is determined only when—

(i)the period within which any appeal under section 11(2) in relation to the application may be made expires (without such an appeal being made), or

(ii)any such appeal is concluded,

(b)subsection (3)(b) and paragraph (a)(ii) of this subsection, an appeal is concluded only when—

(i)the period within which an appeal under section 11(9) may be made has expired without such an appeal being made, or

(ii)any such appeal has been concluded.

Commencement Information

I17S. 12 in force at 1.10.2012, see s. 33(2)

Property factor registered numbersS

13Property factor registered numbersS

(1)The Scottish Ministers must allocate a number to each registered property factor (the “property factor registered number”).

(2)The property factor registered number may be in such form, consisting of one or more sequences of letters or numbers, as the Scottish Ministers may determine.

(3)A registered property factor must take all reasonable steps to ensure that the property factor registered number is included in—

(a)any document sent to a homeowner,

(b)any other document or communication of such type as the Scottish Ministers may by order specify.

(4)Any person other than a registered property factor who, without reasonable excuse, uses a number purporting to be a property factor registered number in any document or communication commits an offence.

(5)Subsection (4) does not apply to a person who has been removed from the register under section 8(1) until—

(a)the period within which any appeal under section 11(2) in relation to the removal may be made expires (without such an appeal being made), or

(b)any such appeal is concluded.

(6)A person guilty of an offence under subsection (4) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(7)For the purposes of subsection (5)(b), an appeal is concluded only when––

(a)the period within which an appeal under section 11(9) may be made has expired without such an appeal being made, or

Application and referralS

(1)A homeowner may apply to the [F9First-tier Tribunal] for determination of whether a property factor has failed—

(a)to carry out the property factor's duties,

(b)to ensure compliance with the property factor code of conduct as required by section 14(5) (the “section 14 duty”).

(2)An application under subsection (1) must set out the homeowner's reasons for considering that the property factor has failed to carry out the property factor's duties or, as the case may be, to comply with the section 14 duty.

(3)No such application may be made unless––

(a)the homeowner has notified the property factor in writing as to why the homeowner considers that the property factor has failed to carry out the property factor's duties or, as the case may be, to comply with the section 14 duty, and

(b)the property factor has refused to resolve, or unreasonably delayed in attempting to resolve, the homeowner's concern.

(4)References in this Act to a failure to carry out a property factor's duties include references to a failure to carry them out to a reasonable standard.

(5)In this Act, “property factor's duties” means, in relation to a homeowner—

(a)duties in relation to the management of the common parts of land owned by the homeowner, or

(b)duties in relation to the management or maintenance of land—

(i)adjoining or neighbouring residential property owned by the homeowner, and

(a)refer an application under section 17(1) to [F12the First-tier Tribunal] , or

(b)reject the application.

(2)The [F13Chamber President] may reject an application only if the [F13Chamber President] considers––

(a)that it is vexatious or frivolous,

(b)that the homeowner has not afforded the property factor a reasonable opportunity to resolve the dispute,

(c)where the homeowner has previously made an identical or substantially similar application in relation to the same property, that a reasonable period of time has not elapsed between the applications, or

(d)that the dispute to which the application relates has been resolved.

(3)The [F14Chamber President] must make a decision under subsection (1)––

(a)within 14 days of the [F15First-tier Tribunal’s] receipt of the application concerned, or

Property factor enforcement ordersS

(1)The [F20First-tier Tribunal must, in relation to a homeowner’s application referred to it under section 18(1)(a),] decide—

(a)whether the property factor has failed to carry out the property factor's duties or, as the case may be, to comply with the section 14 duty, and

(b)if so, whether to make a property factor enforcement order.

(2)In any case where the [F21First-tier Tribunal] proposes to make a property factor enforcement order, [F22it] must before doing so––

(a)give notice of the proposal to the property factor, and

(b)allow the parties an opportunity to make representations to [F23it] .

(3)If the [F24First-tier Tribunal is] satisfied, after taking account of any representations made under subsection (2)(b), that the property factor has failed to carry out the property factor's duties or, as the case may be, to comply with the section 14 duty, the [F25First-tier Tribunal] must make a property factor enforcement order.

(4)Subject to section 22, no matter adjudicated on by the [F26First-tier Tribunal] may be adjudicated on by another court or tribunal.

(a)the [F34First-tier Tribunal considers] , on the submission of the property factor or otherwise, that any action required by a property factor enforcement order has not been, or will not be, executed during the period within which the order requires the work to be executed, and

(i)[F36considers] that satisfactory progress has been made in executing the action required, or

(ii)[F37has] received a written undertaking from the property factor stating that the action required will be executed by a later date which the [F35First-tier Tribunal][F36considers] satisfactory.

(4)References in this Act to a property factor enforcement order or to action required by such an order are, where the order has been varied under this section, to be treated as references to the order as so varied or, as the case may be, to action required by the order as so varied.

Effect of failure to comply with property factor enforcement orderS

23Effect of failure to comply with property factor enforcement orderS

(1)It is for the [F39First-tier Tribunal] to decide whether a property factor has failed to comply with a property factor enforcement order made by the [F40First-tier Tribunal] .

(2)Where the [F41First-tier Tribunal][F42decides] that a property factor has failed to comply with the property factor enforcement order, the [F41First-tier Tribunal] must serve notice of the failure on the Scottish Ministers.

(3)The [F43First-tier Tribunal] may not decide that a property factor has failed to comply with a property factor enforcement order––

(a)unless the period within which the order requires any work to be executed has ended, or

(b)if the [F44First-tier Tribunal is] satisfied, on the submission of the property factor or otherwise––

(i)that the property factor is unable to comply with the order because of a lack of necessary rights (of access or otherwise) despite having taken reasonable steps for the purposes of acquiring those rights, or

(ii)that any action required by the order is likely to endanger any person.

(4)Where the [F45First-tier Tribunal is] prevented by reason only of subsection (3)(b) from deciding that a property factor has failed to comply with a property factor enforcement order, the [F46First-tier Tribunal] must serve notice on the Scottish Ministers stating that [F47it considers] the property factor to be unable to comply with the property factor enforcement order.

24Property factor enforcement order: offencesS

(1)A person who, without reasonable excuse, fails to comply with a property factor enforcement order commits an offence.

(2)For the purposes of subsection (1), a person has reasonable excuse for failing to comply with a property factor enforcement order if––

(a)the person is unable to comply with the order because of a lack of necessary rights (of access or otherwise) despite having taken reasonable steps for the purposes of acquiring those rights, or

(b)any action required by the order is likely to endanger any person.

(3)Subsection (2) does not affect the generality of the defence of reasonable excuse.

(4)A person cannot be guilty of an offence under subsection (1) unless the [F48First-tier Tribunal] which made the property factor enforcement order in question [F48has] decided under section 23(1) that the property factor has failed to comply with it (but such a decision does not establish a presumption that the person has committed an offence under subsection (1)).

(5)A person who is guilty of an offence under subsection (1) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

Part 3SMiscellaneous and general

28Delegation of functionsS

(1)The Scottish Ministers may by order provide that any of their functions under this Act are to be performed on their behalf by such other person as may be specified in the order.

(2)An order under subsection (1) is not to be made unless a draft of the statutory instrument containing the order has been laid before, and approved by resolution of, the Scottish Parliament.

(3)Subsection (1) does not apply in relation to Scottish Ministers' functions under that subsection and sections 2(3), 3(2)(f), (3)(b), (4) and (5), 7(4) and (5), 13(3), 14(3)(a) and (c), F52... 29(1) and 33(2).

29Ancillary provisionS

(1)The Scottish Ministers may by order make such incidental, supplementary, consequential, transitional, transitory or saving provision as they consider appropriate for the purposes of, in consequence of, or for giving full effect to, any provision of this Act.

(2)An order under subsection (1) may modify any enactment (including this Act).

(3)An order under subsection (1) is not to be made unless a draft of the statutory instrument containing the order has been laid before, and approved by resolution of, the Scottish Parliament.

30Orders and regulationsS

(1)Any power of the Scottish Ministers under this Act to make an order or regulations is exercisable by statutory instrument.

(2)Any such power includes power to make––

(a)different provision for different cases or different classes of case, and

(3)A statutory instrument containing an order or regulations made under this Act (except an order under section 2(3), 14(3)(c), 28(1), 29(1) or 33(2) F53...) is subject to annulment in pursuance of a resolution of the Scottish Parliament.

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